NATO’s John Fithian At CinemaCon: Theatrical “Remains A Strong Business In Face Of Disruption”

NATO President and CEO John Fithian has heard too often from the press that theatrical moviegoing is on the wane in the face of streaming. He took to the podium at CinemaCon today to remind exhibition and the studios that “the industry is more dynamic than ever.”

“The word disruption is thrown around way too much,” said the NATO chief. “Nothing needs to be disrupted when it comes to the basic goal of our industry: bringing people together to share a communal experience.”

“Every downturn in admissions is a sign of secular decline, every innovation or improvement is intended to “save” the movie theater business. There has been a lot of hype about the next ‘disruption.’ VHS. DVD. Streaming. Shortened windows. PVOD. Subscriptions and simultaneous release. Yet we never die but remain a strong business in the face of disruption everywhere else in the entertainment landscape.”

The NATO boss touted the domestic B.O. total of $11B, the third year in a row the industry has hit that milestone number. He noted that last summer’s slowdown “was reversed quickly with the timely arrival of It, and a fourth quarter when we saw robust box office for such titles as Star Wars: The Last Jedi, Jumanji: Welcome to the Jungle, The Greatest Showman, The Shape of Water, Lady Bird and Three Billboards Outside Ebbing Missouri. The point here is simple: our business rises or falls on the movies in our cinemas. It doesn’t stand to reason that movie-going habits have permanently changed, based on the performance of any given movie, weekend, month, or quarter. North America remains the biggest market in the world. It accounts for roughly 30% of global revenue from only 5% of the population.”

Other industry boasts: a global record $40B gross, with worldwide box office growing 17% since 2012. Another spike is expected after Saudi Arabia opened its doors to movie going, a development that could lead to a potential of an extra $1 billion in business over time.

Fithian by now was strutting, and out came the inevitable jab against streamers like Netflix.

“Would Black Panther, Get Out, Wonder Woman or any other major recent hits have become significant cultural landmarks if they went straight to streaming? Of course not,” said Fithian in answering his own question. “Their impact is a direct result of people experiencing them in a communal way. During Black Panther’s opening weekend, social media lit up with excited moviegoers taking pictures in crowded theater lobbies,” said Fithian.

“We know that some of the most exciting directors working today—from Jordan Peele to Greta Gerwig to Steven Spielberg to Christopher Nolan—bring their visions to life with the big screen in mind. In front of the camera, Margot Robbie made it clear that she wanted I, Tonya to receive a robust theatrical run and not go straight to streaming. She’s not alone.”

Fithian continued: “Let’s talk about the relationship between streaming and theatrical. We recently conducted a study with Ernst & Young of over 1,400 people who watched at least one movie in theatres in 2017 and spent one hour per week on streaming services. The study found that 33% of moviegoers who see 9 or more movies per year—twice the national average—also spend 15 or more hours per week on streaming platforms. People who consume a lot of content do so across multiple platforms. A robust theatrical release helps a movie stand out among myriad choices on digital platforms. The movie industry is not a zero-sum game. The more movie lovers we can create, the better off we all are. And it starts with movie theaters.”

Fithian countered the suspicion that young folks aren’t heading to the cinema. Outside of Marvel, Star Wars and family fare, studios have expressed concern about continuing institutional moviegoing habits as youth busies itself with the latest iPhone or tech innovation.

Said Fithian: “According to data from comScore—NATO’s official data partner—moviegoers aged 18-44 constituted 63% of the total box office in 2017—up from 61% in 2016. 13-24 year olds accounted for 36.1%—up from 35.6% the previous year.”